US stocks jump as oil price falls

DPA New York, July 9 (DPA) US stock indices recorded their biggest jump in a month as oil prices fell sharply Tuesday and the Federal Reserve opened the door to extending emergency lending into 2009. Fed Chairman Ben Bernanke said that the central bank’s unprecedented lending to investment banks, set up in March at the height of the credit crisis for a six-month period, could be extended into 2009 if the financial sector’s “unusual and exigent circumstances continue to prevail.”

Government-chartered mortgage lenders Fannie Mae and Freddie Mac, whose stock prices tumbled Monday after an analyst said they could need $75 billion in fresh capital, rebounded on Bernanke’s comments. A government regulator also said the two lenders were “adequately capitalized”.